Reverse Engineering Google’s Innovation Machine

Topics: Innovation, Sustainability, Management Pages: 29 (6499 words) Published: November 29, 2012
Organizational capabilities as the key to Sustainable
Innovation
Cécile van Oppen*
Squarewise, Claude Debussylaan 48, 1082 MD Amsterdam, The
Netherlands
E-mail: vanoppen@squarewise.com

Luc Brugman
Squarewise, Claude Debussylaan 48, 1082 MD Amsterdam, The
Netherlands
E-mail brugman@squarewise.com
* Corresponding author
Abstract: Whereas organizations traditionally approach sustainability from a technical perspective, and strive to “do things better”, we argue that the sustainability challenges of our time require companies to “do things differently”. This differentiation and market creation strategy will allow companies to sufficiently leverage sustainability as a business opportunity. We introduce the concept of Sustainable Innovation (SI) as the means for companies to create new markets through the synergetic relationship of sustainability and innovation. Although academic literature has broadly noted the significance of SI, we fill the gap in literature by describing how to achieve SI. We argue that in order to achieve SI, different organizational capabilities are needed. After providing a theoretical basis as well as a theoretical framework, we consequently offer an organizational capabilities model that facilitates SI, supported with fourteen hypotheses. The hypotheses are formed through academic literature and case study research.

Keywords: Sustainability; Sustainable Innovation; Organizational Capabilities

The growing concerns for sustainability within the business landscape compel organizations to leverage sustainability as a business opportunity. We define sustainability as “…meeting the needs of the present without compromising the ability of future generations to meet their own needs”1. We argue that traditional organizations are not fully equipped for this challenge. We propose that this is not because these organizations lack motivation, but rather because sustainability is approached through a primarily technical perspective. This perspective inherently leads to technically-oriented solutions geared at energy efficiencies, waste reductions and resource efficiencies (to name a few). In order to make the sustainable transition and leverage sustainability as a 1

1

Brundtland, G., and Khalid, M. 1987. Our Common Future. World Commission on Environment and Development. Oxford University Press.

competitive edge, the challenge lies not so much in “doing things better” as the technical perspective facilitates, but rather “doing things differently”. In order to make the shift to “doing things differently”, companies have to become capable of what we call Sustainable Innovation (SI): “the synergetic relationship between sustainability and innovation in the core of organizations that drives the development of radically new business (products, services, processes, systems and behavior) and in doing so creating long-term social, environmental as well as economic value”. Academic literature has long encouraged sustainability as a topic for the corporate agenda by focusing on the (un)profitability of incorporating sustainability practices (e.g. Lee , Faff & Langfield-Smith, 2009; Hill, Ainscough & Shank, 2007; Margolis, Elfenbein & Walsh, 2007; Pava & Krausz, 1996). More recently, sustainability has been identified as the new driver for innovation (Nidumolu, Prahalad & Rangaswami, 2009; Jorna, 2006; MacGregor, Espinach & Fontrodona, 2007), arguing that only companies that make sustainability a goal will achieve the desired competitive advantage. Little literature, however, has discussed how organizations can innovate sustainably. Yet it is just this how question that is vital when equipping an organization to meet the sustainability challenge, and leverage it as a business opportunity.

We argue that SI within organizations can be facilitated through fostering certain organizational capabilities. In this paper we will identify the capabilities that are conducive for SI, based on existing literature...

References: Atuahene-Gima, K. 2003. Effects of Centrifugal and Centripetal Forces on Product
Development Speed and Quality: How Does Problem Solving Matter? Academy of
Dunphy, D., Griffiths, A., and Benn, S. 2003. Organizational Change for Corporate
Sustainability
Elkington, J. 2004. Enter the triple bottom line. In. Hendriques and Richardson (Eds.),
The Triple Bottom Line: Does it All Add Up?: 1-16
Epstein, M., and Roy, M. 2001. Sustainability in action: identifying and measuring the
key performance drivers
Epstein, M. 2008. Making Sustainability Work: Best Practices in managing and
measuring corporate social, environmental and economic impacts
Gratton, L. 2007. Hot Spots: Why some teams, workplaces and organizations buzz with
energy, and other’s don’t
Hambrick, D., and Mason, P. 1984. Upper Echelons: The Organization as a Reflection of
Its Top Managers
Hansen, M. 1999. The Search-Transfer Problem: The Role of Weak Ties in Sharing
Knowledge Across Organizational Subunits
Hargreaves, A., Fink, D. 2006. Sustainable Leadership, San Fransisco, Jossey-Bass, cop.
Hart, S. 1995. A Natural Resource-Based View of the Firm. Academy of Management
Review
Hedges, A., 1985. Group Interviewing. In: Walker, R., ed. Applied Qualitative Research.
Heinbokel J., and Potash P., 2000. System Dynamics as a Foundation for a Course on
Sustainable Development
Hill, R. P., T. Ainscough, Shank, T., Manullang, D. 2007. Corporate social responsibility
and socially responsible investing: A global perspective
Hjorth, P., Bagheri, A. 2006. Navigating towards sustainable development: A system
dynamics approach
Jans, R., Dittrich, K., 2008. In: Dul, J., Tony, H., 2008. Case study methodology in
business research
Jorna, R. (Ed.). 2006. Sustainable Innovation. The organisational, human and knowledge
dimension
Jorna R., van Engelen, J., and Hadders H. 2004. Sustainable innovation. Organizations
and the dynamics of knowledge creation
King, A., Lenox, M. 2001. Does it really pay to be green? An empirical study of firm
environmental and financial performance
Kleef, J., and Roome, N. 2005. Developing capabilities and competence for sustainable
business management as innovation: a research agenda
Lee, D.D., Faff, R.W., Langfield-Smith, K. 2009. Revisiting the Vexing Question: Does
Superior Corporate Social Performance Lead to Improved Financial Performance?
Lepoutre, J. 2008. Proactive environmental strategies in small businesses: resources,
institutions and dynamic capabilities
MacGregor, S.P., Espinach, X., Fontrodona, J. 2007. Social innovation: using design to
generate business value through corporate social responsibility
Margolis, J. D., Elfenbein, H. A., Walsh, J. P. 2007. Does it pay to be good? A metaanalysis and redirection of research on the relationship between corporate social
and financial performance
McElroy, M. 2002. The New Knowledge Management, Complexity, Learning and
Sustainable Innovation
Moenaert R., Caeldries, F., Lievens, A., and Wauters, E. 2000. Communication Flows in
International Product Innovation Teams
Mumford, M. 2000. Managing Creative People: Strategies and Tactics for Innovation.
Nahapiet, J., Gratton, L., and Rocha, H. 2005. Knowledge and Cooperative
Relationships: When Cooperation is the Norm
Nidumolu, R., Prahalad, C.K., and Rangaswami, M.R. 2009. Why sustainability is now
the key driver of innovation
Nord, W., and Tucker, S., 1987. Implementing routine and radical innovations.
O’Connor, G., Major innovation as a dynamic capability: A systems approach. Journal of
Product Innovation Management, 25 (2008), 313-330.
Pava, M. L., Krausz, J. 1996. The Association Between Corporate Social Responsibility
and Financial Performance: The Paradox of Social Cost
Petrick J., Ainina, M., Scherer, R., Brodzinski, J. 1999. Global Leadership Skills and
Reputational Capital: Intangible Resources for Sustainable Competitive
Schwarz, J., Beloff, B., and Beaver, E. 2002. Use Sustainability Metrics to Guide
Decision-Making
Sekaran, V., 1992. Research methods for business. 2nd ed. New York: Wiley.
Senge, P., Carstadt, G., and Porter, P. 2001. Innovating our way to the next industrial
revolution
Senge P., Smith B., Kruschwitz, N., Laur J., and Schley, S. 2008. The Necessary
Revolution New York: Doubleday.
Sheremata, W. 2000. Centrifugal and centripetal forces in radical new product
development under time pressure
Tapscott, D., Ticoll, D., and Lowy, A., 2000. Digital Capital: Harnessing the Power of
Business Webs
Teece, D., 2007. Explicating Dynamic Capabilities: The Nature and Microfoundations of
Continue Reading

Please join StudyMode to read the full document

You May Also Find These Documents Helpful

  • Essay on Reverse Engineering
  • innovation report Essay
  • Reverse Innovation in Multinational Enterprises Essay
  • Innovation Essay
  • engineering Essay
  • Innovation Essay
  • Essay about INNOVATION
  • Essay about Reverse & Frugal Innovation

Become a StudyMode Member

Sign Up - It's Free